Budgeted sales for January$206,000 and February $109,000. times Collections for sales are50% in the month of sale and 50% the next month. times Gross margin is 25% of sales. times Administrative costs are $19,000 each month. times Beginning accounts receivable is $29,000. times Beginning inventory is $14,000. times Beginning accounts payable is $74,000. (All from inventory purchases.) times Purchases are paid in full the following month. The information pertains to the January operating budget for a Corporation. Desired ending inventory is 20% of next month's cost of goods sold (COGS). At the end ofJanuary, budgeted ending inventory is what
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Budgeted sales for January$206,000 and February $109,000. times Collections for sales are50% in the month of sale and 50% the next month. times Gross margin is 25% of sales. times Administrative costs are $19,000 each month. times Beginning
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